Today’s Weekend Daily Reckoning is going to deliver you the Inspiration. But the Inspiration is not what you’re thinking. Prepared to guess?
Well, it’s actually the name of a truck that Freightliner Trucks, a division of Daimler, released this week. But this isn’t your average road train.
It’s the first semi-truck capable of fully autonomous highway driving that’s been given the official go ahead to operate on public highways in Nevada, according to IEEE Spectrum.
The truck can drive itself on good highways, in daylight, with fair weather. By law it needs a human in the cab to oversee what’s happening. But in reality the driver doesn’t need to be paying attention.
The truck can follow GPS directions, stay within the correct lane, and slow, stop or speed up depending on traffic.
Or, as the article puts it: ‘It’s probably not a good idea for the driver to be asleep in the back, but he or she can be doing other work, reading, watching a movie, or playing Angry Birds.’
Tough job! To be fair, trickier variables and road conditions means it needs human control. But the point is this truck is licensed to operate. It’s happening now. Imagine a truck driving behind you with no driver.
It would look like this…
Nevada is the first US state, but it won’t be long before trucks like this are operating all over the United States, and eventually, the world.
Think of the benefits. Just off the top of my head: drivers can work on other projects while in commute. Productivity will rise as delivery chains become more efficient.
Most accidents are from human error. Remove the human factor and you’ll have lower insurance premiums and damage costs. There’ll be less resources required for traffic cops, smash repairs and the traffic jams truck accidents cause.
The technology behind this will drive profits in various associated industries for some time. There are two ways to profit from this.
The obvious one that springs to mind is to find the stocks that will increase earnings from this, either directly or indirectly.
This is where a subscription to Cycles, Trends and Forecasts puts you ahead of most investors. Because the second is only obvious if you understand British economist David Ricardo’s Theory of Rent. It’s to buy real estate.
Why? Over time, the ‘super’ profits of the inventors reduces as competition eliminates them. Wages will see a small rise as such inventions and improvements increase the size of the economic pie.
So what takes the biggest gain? Land value. Classical economist called the return to land ‘economic rent’. It is the Rent that just keeps on increasing, relentlessly. That’s why we’re all slaving away to afford a house.
Adam Smith, when he wrote the Wealth of Nations expressed the idea in this way:
‘…every improvement in the circumstances of society tends either directly or indirectly to raise the real rent of land, to increase the real rent of the landlord, his power of purchasing over the labour, or the produce of the labour of other people.’
At Cycles, Trends & Forecasts we just say that land price takes all the gains…eventually.
We can see this operating elsewhere. Just this week there was news that employees earning six figure wages in Silicon Valley are being priced out of the real estate market.
Now that’s funny. You’d think that those guys earning megabucks in Silicon Valley could buy up all the housing they wanted. But no.
Just ask Brandon Jones, a Google employee CBS interviewed.
‘By most standards, Jones and his family have it all. He’s a software engineer at the Mountain View tech company, lives 10 minutes from work and makes six figures.
‘The problem is, he has to move, and being a Google employee doesn’t guarantee a place to stay in Mountain View.
‘“It is a long-running joke at Google that none of the employees can afford to live nearby the office, because things are so astronomically high,” Jones said.’
Land price is taking all the gains, see. Few people understand this.
Here’s why. Mason Gaffney, a retired economics professor from Riverside, California, wrote it up in a superb book, The Corruption of Economics.
It details clearly how this knowledge of Ricardo’s Theory of Rent was deliberately written out of the university economics courses and text books.
Understanding why this was done gives you a great insight into ‘the system’. Once you understand it, you can take advantage of it. If you want that insight, read more here.
for The Daily Reckoning Australia